Resmed (RMD) AI Stock Analysis

• Market Cap: $31.79B
• Dividend Yield: 0.96%
• Average Volume (3M): 1.06M
• Price to Earnings (P/E): 25.6
• Beta (1Y): 1.11
• Revenue Growth: 9.38%
• EPS Growth: 40.38%
• Country: US
• Employees: 9,980
• Sector: Healthcare
• Sector Strength: 74
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 8.46
• Shares Outstanding: 146,866,910
• 10 Day Avg. Volume: 1,258,709
• 30 Day Avg. Volume: 1,058,363
• PEG Ratio: 0.63
• Price to Book (P/B): N/A
• Price to Sales (P/S): 6.55
• Price to Cash Flow (P/CF): 26.10
• P/FCF Ratio: 26.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $272.90
• Price Target Upside: 29.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13

Resmed's stock score reflects robust financial performance and positive earnings call sentiment, highlighting strong revenue and profit growth, operational efficiency, and strategic innovation. Technical analysis suggests caution due to bearish trends, while valuation metrics indicate the stock is reasonably priced. Overall, Resmed is well-positioned for continued growth, but investors should be mindful of technical signals and external factors.

Positive Factors

Growth Opportunity

Analyst remains bullish on Resmed Inc given new start growth opportunity and reiterates a Buy recommendation.

Market Position

The company's alignment with American Academy of Sleep Medicine guidelines positions CPAP as a front-line gold standard therapy for sleep apnea.

Price Target

The price objective for Resmed Inc is set at $280 per share, indicating potential upside from the current price.

Negative Factors

GLP-1 Medications

The increasing prominence of GLP-1 medications is expected to pose several challenges for the CPAP market.

Market Growth

Over 50% of Sleep Specialists believe GLP-1s will slow the growth trajectory of the CPAP market.

Tariffs Impact

A 10% baseline tariff applied to AUS and SNG products could negatively impact Resmed Inc's financial performance.

Resmed Business Overview & Revenue Model

Company Description

ResMed Inc. develops, manufactures, distributes, and markets medical devices and cloud-based software applications for the healthcare markets. The company operates in two segments, Sleep and Respiratory Care, and Software as a Service. It offers various products and solutions for a range of respiratory disorders, including technologies to be applied in medical and consumer products, ventilation devices, diagnostic products, mask systems for use in the hospital and home, headgear and other accessories, dental devices, and cloud-based software informatics solutions to manage patient outcomes, as well as provides customer and business processes. The company also provides AirView, a cloud-based system that enables remote monitoring and changing of patients' device settings; myAir, a personalized therapy management application for patients with sleep apnea that provides support, education, and troubleshooting tools for increased patient engagement and improved compliance; U-Sleep, a compliance monitoring solution that enables home medical equipment (HME)to streamline their sleep programs; connectivity module and propeller solutions; and Propeller portal. It offers out-of-hospital software solution, such as Brightree business management software and service solutions to providers of HME, pharmacy, home infusion, orthotics, and prosthetics services; MatrixCare care management and related ancillary solutions to senior living, skilled nursing, life plan communities, home health, home care, and hospice organizations, as well as related accountable care organizations; and HEALTHCAREfirst that offers electronic health record, software, billing and coding services, and analytics for home health and hospice agencies. The company markets its products primarily to sleep clinics, home healthcare dealers, and hospitals through a network of distributors and direct sales force in approximately 140 countries. ResMed Inc. was founded in 1989 and is headquartered in San Diego, California.

How the Company Makes Money

ResMed generates revenue through the sale of its medical devices and related accessories, primarily targeting patients suffering from sleep apnea and other chronic respiratory conditions. A significant portion of its income is derived from its comprehensive range of CPAP machines and masks, which are sold to healthcare providers, distributors, and direct-to-consumer channels. Additionally, ResMed capitalizes on its digital health platform, which offers cloud-connected solutions for monitoring patients remotely, thereby generating recurring revenue through software subscriptions and data services. The company's strategic partnerships with healthcare providers and institutions further bolster its revenue streams by expanding its market reach and ensuring a steady demand for its products and services. Factors such as global aging populations and increasing awareness of sleep-related health issues also contribute significantly to ResMed's financial performance.

Resmed Financial Statement Overview

Summary

Resmed exhibits a strong financial position across all key verticals. The company demonstrates impressive revenue and profit growth, efficient operations, and a robust balance sheet with low leverage. Cash flow generation is strong, further underscoring the company's financial health. While the financials are very positive, continued focus on optimizing asset utilization and maintaining growth momentum will be important for sustaining strong performance.

Income Statement

Resmed has demonstrated strong revenue growth with a Revenue Growth Rate of 17.7% from 2023 to 2024. Gross Profit Margin and Net Profit Margin are robust at 57.9% and 25.3% (TTM) respectively, indicating effective cost management and profitability. The EBIT Margin is solid at 31.7% (TTM), and the EBITDA Margin is 33.6% (TTM), reflecting healthy operational efficiency. Overall, the income statement reveals strong performance with impressive growth and profitability metrics.

Balance Sheet

The company's balance sheet is strong with a Debt-to-Equity Ratio of 0.16 (TTM), indicating low leverage and financial stability. Return on Equity (ROE) stands at 23.8% (TTM), showing effective use of equity to generate profits. The Equity Ratio is high at 73.5% (TTM), suggesting a solid equity base relative to assets. Overall, the balance sheet is in good health, with low debt levels and high shareholder equity, though there are opportunities to optimize asset utilization further.

Cash Flow

Resmed's cash flow position is strong, with a Free Cash Flow Growth Rate of 7.9% from the previous period, demonstrating effective cash generation. The Operating Cash Flow to Net Income Ratio of 1.18 (TTM) signifies excellent cash conversion from net income. The Free Cash Flow to Net Income Ratio is also strong at 1.11 (TTM), highlighting the company's ability to generate free cash flow relative to its net income. Overall, the cash flow statement reflects strong cash generation and conversion capabilities, supporting financial flexibility.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
4.93B	4.69B	4.22B	3.58B	3.20B	2.96B
	Gross Profit
2.85B	2.66B	2.36B	2.02B	1.84B	1.72B
	EBIT
1.56B	1.32B	1.13B	1.00B	903.68M	809.66M
	EBITDA
1.66B	1.53B	1.36B	1.18B	1.10B	990.43M
	Net Income Common Stockholders
1.25B	1.02B	897.56M	779.44M	474.50M	621.67M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
520.94M	238.36M	227.89M	273.71M	295.28M	463.16M
	Total Assets
1.71B	6.87B	6.75B	5.10B	4.73B	4.59B
	Total Debt
143.70M	873.93M	1.58B	917.55M	793.72M	1.30B
	Net Debt
-377.24M	635.57M	1.35B	643.84M	498.44M	836.11M
	Total Liabilities
381.26M	2.01B	2.62B	1.74B	1.84B	2.09B
	Stockholders Equity
1.33B	4.86B	4.13B	3.36B	2.89B	2.50B
Cash Flow		Free Cash Flow
1.39B	1.29B	559.30M	195.11M	619.89M	696.32M
	Operating Cash Flow
1.48B	1.40B	693.30M	351.15M	736.72M	802.25M
	Investing Cash Flow
-114.21M	-269.78M	-1.16B	-229.92M	-158.46M	-179.86M
	Financing Cash Flow
-1.03B	-1.12B	422.87M	-128.36M	-764.63M	-317.29M

Resmed Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 210.55
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RMD, the sentiment is Negative. The current price of 210.55 is below the 20-day moving average (MA) of 218.64, below the 50-day MA of 227.74, and below the 200-day MA of 230.16, indicating a bearish trend. The MACD of -2.83 indicates Negative momentum. The RSI at 45.21 is Neutral, neither overbought nor oversold. The STOCH value of 54.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RMD.

Resmed Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RMD	78 Outperform	$31.79B	25.57	25.65%	0.96%	9.38%	40.38%
BDX	76 Outperform	$60.11B	34.78	6.92%	1.90%	5.89%	42.05%
COO	73 Outperform	$15.58B	37.67	5.25%	―	7.15%	41.96%
HOLX	71 Outperform	$13.31B	18.77	15.78%	―	1.75%	50.25%
MASI	55 Neutral	$8.89B	116.65	-25.23%	―	2.26%	-467.23%
BAX	49 Neutral	$15.77B	136.07	-9.24%	2.99%	-14.00%	-184.82%
Sector *	48 Neutral	$6.36B	1.28	-45.04%	2.64%	19.24%	1.69%